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Accounting Policies of Nesco Ltd. Company

Mar 31, 2013

A. Basis of preparation

The financial statements have been prepared on accrual basis under historical cost convention and in compliance, in all material aspects, with the applicable accounting principles in India, the applicable accounting standards notified by the companies (Accounting standards) Rules, 2006 and are in accordance with the requirements of the Companies Act, 1956.

B. Revenue recognition

Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection. Revenue from operations include sale of goods, engineering fees, services and other charges, sale of goods is recognized on transfer of significant risks and rewards of ownership which is generally on the dispatch goods net of excise, Vat and other taxes, if any. Revenue from IT Park division is considered on accrual basis except in the case of rent of building at Worli under subsidised Housing Scheme on account of uncertainties of its recovery.

Dividend income is recognised when the right to receive the payment is established.

Interest income is recognised on accrual basis.

C. Fixed assets and Depreciation

i. Fixed assets are stated at cost/revalued less accumulated depreciation.

ii. Depreciation on plant & machinery and electrical installations in respect of Bombay Exhibition Centre division has been provided on straight-line basis and for Manufacturing and machinery in IT Park divisions on written down value basis at the rates specified in Schedule XIV of the Companies Act, 1956.

iii. Assets valuingRs. 5,000/-or less has been depreciated at 100%.

D. Investments

Non-current Investments are stated at cost. Provision for diminution in value of long term investments is made only if such a decline is other than temporary. Current Investments are stated at lower of cost and quoted/fair value.

E. Inventories

i. Raw materials are valued at lower of cost or net realizable value. Cost is determined on weighted average basis.

ii. Semi-finished goods are valued as per sales order value on the basis of percentage of work completed less 10% margin.

iii. Finished goods are valued at cost or market value whichever is lower.

iv. Stores and spares are valued at lower of cost or net realizable value. Cost is determined on weighted average basis.

F. Foreign currency transactions

i. Fixed Assets are translated into rupees at the rates prevailing on the date of purchase/acquisition.

ii. Foreign currency liabilities for acquisition of fixed assets are stated at the rate prevailing on the date of purchase/acquisition.

iii. Other transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transactions. Exchange difference between the rates applicable on the date of transaction and the rate actually realised/paid are recognised as income/expense in the statement of Profit and Loss.

G. Employee benefits

I. Short term employee benefits payable within twelve months of rendering the service are classified as short term employee benefits and they are recognised as an expense in the statement of profit and loss,

ii. Post employment and other long term employee benefits are recognised as an expense in the statement of profit and loss for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the statement of profit and loss.

H. Deferred taxes on income

Deferred tax is recognised for all timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

I. Impairment of assets

The Company reviews the carrying values of tangible assets for any possible impairment at each balance sheet date. An impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount. In assessing the recoverable amount, the estimated future cash flows are discounted to their present value based on appropriate discount rates.

J. Borrowing cost

Borrowing cost that are attributable to the acquisition or construction of qualifying asset are capitalised as part of the cost of such asset. All other borrowing cost are charged to statement of profit and loss.

K. Segment

i. Segment accounting policies are in line with the accounting policies of the Company. However, the following specific accounting policies have been followed for segment reporting.

ii. Segment revenue includes sales and other income directly identifiable with/allocable to the segment including inter-segment revenue.

iii. Expenses that are directly identifiable with/allocable to segments are considered for determining the segment result.

L. Trade receivables

Trade receivables are stated after writing off debts considered as bad.

M. Provisions and contingencies

The company creates a provision when there exists a present obligation as a result of past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. Adisclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources, when there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.

N. Earnings per share

The basic and diluted earnings per share ("EPS") is computed by dividing the net profit after tax for the year by weighted average number of equity shares outstanding during the year.

O. Proposed Dividend

Dividend recommended by the Board of directors is provided for in the accounts, pending approval at the annual general meeting.

P. Other accounting policies

These are considered with generally accepted accounting principles.


Mar 31, 2012

GENERAL

The financial statements have been prepared on accrual basis and under historical cost convention and in compliance, in all material aspects, with the applicable accounting principles in India, the applicable accounting standards notified and are in accordance with the requirements of the Companies Act, 1956.

1. Revenue recognition

Income & Expenditure are generally accounted on accrual basis. Sale of goods is recognized on transfer of significant risks and rewards of ownership which is generally on the dispatch of goods.

2. Fixed assets and Depreciation

i. Fixed assets are shown at cost/revalued less accumulated depreciation.

ii. Depreciation on plant & machinery and electrical installations in respect of Convention and Exhibition Centre division has been provided on straight-line basis and for other divisions on written down value basis at the rates specified in Schedule XIV of the Companies Act, 1956.

iii. Assets valuing Rs. 5,000/- or less has been depreciated at 100%.

3. Investments

Current Investments are stated at cost less provision for diminution in value if any. Long term investments are stated at cost.

4. Inventories

i. Raw materials are valued at lower of cost or net realizable value.

ii. Semi-finished goods are valued at cost. Cost in case of semi finished and finished goods is determined on the basis of cost of manufacturing. The cost includes material cost, labour cost and all other direct and indirect overheads including interest.

iii. Finished goods are valued at cost or market value whichever is lower.

iv. Stores and spares are valued at lower of cost or net realizable value.

5. Foreign currency transactions

i. Fixed Assets are translated into rupees at the rates prevailing on the date of purchase/acquisition.

ii. Foreign currency liabilities for acquisition of fixed assets are stated at the rate prevailing on the date of purchase/acquisition.

iii. Other transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transactions. Exchange difference between the rates applicable on the date of transaction and the rate actually realized/paid are recognized as income/expense in the Profit and Loss Account.

6. Employee benefits

Provision for gratuity and leave encashment has been made as per Accounting Standard (15).

7. Income

Income from Realty division is considered on accrual basis except in the case of rent of building at Worli under subsidized Housing Scheme on account of uncertainties of its recovery.

8. Deferred taxes on income

Deferred tax is recognized for all timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

9. Impairment of assets

The Company reviews the carrying values of tangible and intangible assets for any possible impairment at each balance sheet date. An impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount. In assessing the recoverable amount, the estimated future cash flows are discounted to their present value based on appropriate discount rates.

10. Segment

i. Segment accounting policies are in line with the accounting policies of the Company. However, the following specific accounting policies have been followed for segment reporting.

ii. Segment revenue includes sales and other income directly identifiable with/allocable to the segment including inter-segment revenue.

iii. Expenses that are directly identifiable with/allocable to segments are considered for determining the segment result.

11. Other accounting policies

These are considered with generally accepted accounting principles.


Mar 31, 2011

1. GENERAL

The Financial statements are generally prepared under the historical cost convention on an accrual basis and are in accordance with the requirements of the Companies Act, 1956.

2. REVENUE RECOGNITION

Income & Expenditure are generally accounted on accrual basis.

3. FOREIGN CURRENCY TRANSACTIONS

i) Fixed Assets are translated into rupees at the rates prevailing on the date of purchase/acquisition.

ii) Foreign currency liabilities for acquisition of fixed assets are stated at the rate prevailing on the date of purchase/acquisition.

iii) Other transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transactions. Exchange difference between the rates applicable on the date of transaction and the rate actually realized/paid are recognized as income/expense in the Profit and Loss Account.

4. FIXEDASSETSAND DEPRECIATION

i) Fixed assets are shown at cost/revalued less accumulated depreciation.

ii) Deferred revenue expenditure is written off over the period of activity to which the expenses relate.

iii) Depreciation on plant & machinery and electrical installations has been provided on straight-line basis and on other assets on written down value basis at the rates specified in Schedule XIV of the Companies Act, 1956. iv) Assets valuing 5,000/- or less has been depreciated at 100%.

5. INVESTMENTS

Long Term Investments are stated at cost less provision for diminution in value other than temporary if any.

6. INVENTORIES

i) Stores and spares are valued at cost.

ii) Raw materials are valued at cost and components at estimated cost.

iii) Finished goods are valued at cost or market value whichever is lower. Cost in case of semi finished and finished goods is determined on the basis of cost of manufacturing. The cost includes material cost, labour cost and all other direct and indirect overheads including interest.

7. RETIREMENT BENEFITS

Provision for gratuity and leave encashment has been made as per Accounting Standard (15).

8. INCOME

Income from Realty division is considered on accrual basis, except in the case of rent of building at Worli under subsidised Housing Scheme on account of uncertainties of its recovery.

9. DEFERRED TAXES ON INCOME

Deferred tax is recognized for all timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

10. IMPAIRMENT OF ASSETS

The Company reviews the carrying values of tangible and intangible assets for any possible impairment at each balance sheet date. An impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount. In assessing the recoverable amount, the estimated future cash flows are discounted to their present value based on appropriate discount rates.

11. SEGMENT ACCOUNTING POLICIES

Segment accounting policies are in line with the accounting policies of the Company. However, the following specific accounting policies have been followed for segment reporting.

i) Segment revenue includes sales and other income directly identifiable with/allocable to the segment including inter-segment revenue.

ii) Expenses that are directly identifiable with/allocable to segments are considered for determining the segment result.

12. OTHERACCOUNTING POLICIES

These are considered with generally accepted accounting principles.


Mar 31, 2010

1. General

The financial statements are generally prepared under the historical cost convention on an accrual basis and are in accordance with the requirements of the Companies Act, 1956.

2. Revenue recognition

Income & expenditure are generally accounted on accrual basis.

3. Foreign currency transactions

i) Fixed assets are translated into rupees at the rates prevailing on the date of purchase/acquisition.

ii) Foreign currency liabilities for acquisition of fixed assets are stated at the rate prevailing on the date of purchase/acquisition.

iii) Other transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transactions..

Exchange difference between the rates applicable on the date of transaction and the rate actually realized/paid are recognized as income/expense in the Profit and Loss Account.

4. Fixed assets and depreciation

i) Fixed assets are shown at cost/revalued less accumulated depreciation.

ii) Deferred revenue expenditure is written off over the period of activity to which the expenses relate.

iii) Depreciation on plant & machinery and electrical installations has been provided on straight-line basis and on other assets on written down value basis at the rates specified in Schedule XIV of the Companies Act, 1956.

iv) Assets valuing Rs. 5,000/- or less has been depreciated at 100%.

5. Investments

Long term investments are stated at cost less provision for diminution in value other than temporary if any.

6. Inventories

i) Stores and spares are valued at cost.

ii) Raw materials are valued at cost and components at estimated cost.

iii) Finished goods are valued at cost or market value whichever is lower. Cost in case of semi finished and finished goods is determined on the basis of cost of manufacturing. The cost includes material cost, labour cost and all other direct and indirect overheads.

7. Retirement benefits

Provision for gratuity and leave encashment has been made as per Accounting Standard (15).

8. Income

Income from Realty division is considered on accrual basis except in the case of rent of building at Worli under subsidised Housing Scheme on account of uncertainties of its recovery.

9. Deferred taxes on income

Deferred tax is recognized for all timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

10. Impairment of assets

The Company reviews the carrying values of tangible and intangible assets for any possible impairment at each balance sheet date. An impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount. In assessing the recoverable amount, the estimated future cash flows are discounted to their present value based on appropriate discount rates.

11. Segment accounting policies

Segment accounting policies are in line with the accounting policies of the Company. However, the following specific accounting policies have been followed for segment reporting.

i) Segment revenue includes sales and other income directly identifiable with/allocable to the segment including inter-segment revenue. ii) Expenses that are directly identifiable to segments are considered for determining the segment result.

12. Other accounting policies

These are considered with generally accepted accounting principles.

 
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